For U.S. manufacturers sourcing precision parts from Canada, today’s tariff environment can look increasingly complicated. New tariffs, changing classifications, country-of-origin requirements and customs documentation have added another layer of uncertainty to cross-border manufacturing.
“The situation is difficult, but it isn’t unmanageable,” says Tim Walls, President, Pazmac. “The key is understanding what you’re shipping, how it should be classified, and making sure the documentation is correct before it reaches the border.”
The Tariff You Pay Can Depend on How Your Goods Are Classified
Every product entering the United States must be classified under the Harmonized Tariff Schedule (HTS). That classification helps determine the applicable duty treatment.
For precision-manufactured components, determining the appropriate classification isn’t necessarily as simple as describing a shipment as “machined parts.” Instead, consider:
- What is the part?
- What material is it manufactured from?
- What is its function?
- Is it a finished component or part of a larger assembly?
- Where was it manufactured, and where did the material originate?
- Does it qualify for preferential treatment under the United States-Mexico-Canada Agreement (USMCA)?
These details matter.
A classification or documentation issue can potentially result in duties that might otherwise have been avoided or reduced. It can also lead to questions, delays and additional administrative work at the border.
Who Is Making the Clearance Decisions?
Many U.S. companies naturally rely on their freight carrier, courier or customs broker to manage the clearance process.
That’s understandable. Moving goods across the border isn’t their core business.
But it can create a disconnect.
The people preparing the customs entry may be working from the information provided on the commercial invoice and shipping documentation. They don’t necessarily have the same understanding of the component, its manufacturing process, materials or intended application as the company that actually manufactured it.
That’s where experience matters.
Rather than leaving important shipping information to be interpreted at the end of the process, Pazmac provides the product information and documentation available to support the shipment and assist the customer, carrier and customs professionals with the clearance process.
Can Your Canadian Supplier Help Support the Process?
Pazmac believes the answer should be yes. While Pazmac’s terms are Ex Works (EXW) and the customer remains responsible as the importer of record, experienced support from the manufacturer can help the customer and its customs professionals navigate the process more effectively.
Pazmac’s team has extensive experience shipping precision components from Canada to customers in the United States. The team works closely with customers, carriers and customs professionals, providing available product information and documentation to assist the customer and its customs professionals in determining appropriate descriptions, classifications and trade-agreement considerations.
Pazmac’s experience becomes increasingly valuable in an environment where tariff rules can change and the cost of getting something wrong can be significant. When questions or issues arise, Pazmac works with the customer, carrier and customs professionals to provide available information and help resolve them. The customer, as importer of record, retains responsibility for tariff classification, customs clearance, duties and the import process.
The objective is simple: support the customer’s efforts to get the right parts to the right place while helping avoid unnecessary costs, complications and delays wherever possible.
What Should You Be Asking Your Precision Parts Supplier?
If you’re a U.S. company purchasing components from Canada, consider asking your supplier:
- Do you regularly ship manufactured components into the United States?
- Do you understand the HTS classifications applicable to the products you manufacture?
- Can you provide the information needed to support the appropriate classification?
- Do you understand USMCA origin requirements and when they may apply?
- Will you work with our team, carrier and customs professionals to provide available information and help address questions?
- Are you familiar with the information and documentation commonly required for cross-border shipments?
- If there’s a problem at the border, how will you support our team and customs professionals in resolving it?
These may not be the first questions an engineer or purchasing manager thinks about when selecting a precision manufacturing partner.
But today, they can have a very real impact on total landed cost.
Manufacturing Support Shouldn’t Stop at the Shipping Dock
At Pazmac, we talk frequently about our Business Toolbox, which consists of the experience, relationships, processes and resources we’ve developed to help customers solve problems that extend beyond machining. Supporting customers through cross-border shipping is another example.
Producing an exceptional precision component is central to the job. Customers also value a manufacturing partner with cross-border shipping experience who can supply available product information and documentation, collaborate with carriers and customs professionals, and help address issues when they arise.
Tariffs have made cross-border manufacturing more complicated. They haven’t made it impossible.
With the right information, careful documentation and an experienced manufacturing partner willing to support customers throughout the shipping process, U.S. companies can continue to benefit from working with Canadian precision manufacturers.
Have questions about shipping precision parts from Canada to the United States? Talk to Pazmac about how our experience, product knowledge and documentation can support your team, carrier and customs professionals through the cross-border shipping process.
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